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Canceling a credit card you do not use is not as simple as just canceling it. You need to make sure there is nothing left on this card that will come back to haunt you when you cancel it. canceling a card is just as important as opening a card, both can have affects on your credit. Just pay attention and know what you need to be looking out for in order to have a clean break from your credit.
Cancel When You Must
First of all, do not cancel cards at the same time. You should not open and close accounts all the time. Even when you close accounts that could have a negative affect on your credit. Creditors may think you that you cannot handle the credit you have, so that is why you needed to cancel it.
What Should I Do First?
The first thing you need to do is pay off that balance in full. Do not think that when you cancel the account that it will go away. It won’t! It will stick around even when you think it is gone. Then it will add up with interest and late fees, and it will have a negative affect on your credit report. So make sure that there is no balance on your credit card when you cancel it.
Alert the Relevant Parties
When you have paid the balance, you then need to alert the credit card company by phone that you are cancelling the card. But after you tell them by phone, you then need to do immediately follow up with something in writing telling them the same thing. Follow up until you finally get the results you want. Make sure this does not get pushed to the backburner. When this is all finished you then need to make sure your credit report accurately reflects your situation now. The card should not be there any longer if you have paid off the balance and canceled the card. If there are negative marks, you need to find out why.
When Should I Cancel a Card?
If you opened a card just for balance transfers, you don’t use it, and this was 5 years ago, then you should probably cancel that card. If you have cards and you find yourself in debt, then get rid of the temptation. Anytime you have a card that has a negative affect on your finances, then look into closing a card. Do not open cards just for more credit because that is when the real trouble can begin. Just be smart with the credit and the cards you do have. You will find the trouble will really decline then.
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